The Warsaw Stock Exchange’s (WSE) benchmark WIG index has gained 28.6% since the beginning of 2025, outperforming major global markets amid investor optimism over a potential peace settlement in Ukraine and Poland’s role in regional reconstruction efforts.

WIG closed March 2025 at 95,953.33 points, gaining 20.6% year to date. WIG crossed the symbolic mark of 100,000 points in April for the first time in its history. WSE equity turnover also hit PLN 111.2bn ($28.3bn)—a 34.6% y/y increase.

The WIG index, which tracks the performance of the largest companies listed on the Warsaw Stock Exchange, has outpaced Chile’s IPSA, Greece’s ATHEX, and the US S&P 500, which has edged up only 1% over the same period. The rally reflects growing investor confidence in Poland’s economic fundamentals, as well as its geopolitical positioning as a key player in the post-conflict recovery of neighbouring Ukraine.

Foreign capital inflows have surged in recent months, drawn by relatively low stock valuations and Poland’s stable macroeconomic environment. The WIG’s strong performance has been bolstered by gains in sectors such as banking, energy, and industrials. Notably, PKN Orlen, the country’s largest energy group, has seen its share price rise more than 40% year-to-date, while banks such as PKO Bank Polski and Bank Pekao have posted double-digit gains.

“The WIG index on the Warsaw Stock Exchange has surged by 28.6% since the beginning of 2025, surpassing the markets of Chile, Greece, and the American S&P 500, which saw only a 1% increase,” said a spokesperson for WSE.

Although the WIG index primarily includes Polish firms, shares of several Ukrainian companies — including agricultural producers Agroton and Astarta, and energy firm Coal Energy — are also traded on the Warsaw bourse and have done well. Their presence reflects Warsaw’s growing importance as a financial gateway for Ukraine amid ongoing conflict recovery efforts, and their strong performance reflects the start of negotiations to end the war, albeit them stalled at the moment.

“Investors are optimistic about peace in Ukraine, positioning Poland as a strategic hub for the country’s post-war reconstruction,” the spokesperson added.

Poland’s equity market momentum comes as the European Union and international donors prepare for increased engagement in Ukraine’s rebuilding phase. Warsaw’s geographic proximity and deepening financial ties with Kyiv are seen as key factors in its emerging regional role.

WSE Group strong performance

The WSE Group closed the first quarter with record-high revenue of PLN 132.3mn ($33.7mn), up 11.9% year on year. EBITDA increased by 25.7% year on year to PLN 54.7mn and the net profit attributable to owners of the parent entity increased by 27.8% year on year to PLN 50.5mn. WSE remains a European leader by growth of turnover and liquidity while reporting the highest cost efficiency in twelve quarters, GPW Benchmark SA reports.

• PLN 132.3mn – record-high sales revenue of the GPW Group in Q1 2025 (11.9% y/y)
• PLN 111.2bn – record-high Main Market EOB turnover in Q1 2025 (34.6% y/y)
• PLN 54.7mn – GPW Group’s EBITDA in Q1 2025 (25.7% y/y)
• PLN 50.5mn – net profit attributable to owners of the parent entity in Q1 2025 (27.8% y/y)
• 65.8% – cost-to-income ratio, the lowest in three years
• PLN 3.15 per share – recommended dividend for 2024 (dividend yield 6.6%)

WSE’s shares have also performed well, closing at PLN 50.85 on May 14, 2025, near its 52-week high of PLN 51.60 and well above its 52-week low of PLN 39.90.

Growth drivers

The positive outlook has been driven partly as the Polish economy increasingly decouples from the German economic recession and has seen industrial production surge even as Germany goes into its third year of recession.

WSE has attracted a wave of investor interest in early 2025, buoyed by structural reforms, macroeconomic resilience, and surging activity in Poland’s debt markets. The developments come as Poland continues to outperform much of Europe, posting solid economic growth and containing inflation.

A key driver of market momentum has been the WSE’s Fee Reduction Programme, which lowered transaction costs for exchange-traded funds (ETFs) and exchange-traded commodities (ETCs). The initiative has drawn renewed interest from both retail and institutional investors, increasing trading volumes and broadening exposure to Poland’s equity market.

“The Fee Reduction Programme has been a game-changer. By cutting costs for ETFs and ETCs, the WSE has attracted both retail and institutional investors seeking exposure to Poland’s dynamic economy,” a WSE spokesperson said.

In a further signal of market strength, the WSE announced a dividend recommendation of PLN3.15 per share for its own stock —equivalent to 88.7% of its 2024 profits—underscoring its confidence in long-term growth.

Macroeconomic indicators have supported the rally. Poland’s GDP expanded by 3.9% in 2024, outpacing stagnating growth in much of Europe. Inflation remains contained, contributing to renewed foreign capital inflows. Turnover on GlobalConnect—the WSE’s market for foreign equities—rose 653% year-on-year to PLN29.4mn ($7.48mn) in the first quarter of 2025.

“Poland’s economy has defied European stagnation, with GDP growth of 3.9% in 2024 and inflation under control. This stability has drawn foreign capital,” the spokesperson added.

Meanwhile, the country’s debt markets have experienced a notable uptick. The Catalyst platform for trading corporate and municipal bonds welcomed seven new issuers in March 2025 alone. Among them were landmark municipal bond issuances from Katowice and Sopot, valued at PLN380mn ($96.8mn) and PLN50mn ($12.7mn), respectively.

“This activity underscores Poland’s shift toward capital markets financing, boosting liquidity and investor choice,” the WSE representative said.

The bond market expansion reflects growing interest from municipalities and corporates in raising capital outside traditional banking channels, amid Poland’s maturing financial ecosystem.

The one unknown is the outcome of the second round of the presidential election on June 1. If the liberal Warsaw mayor Rafał Trzaskowski wins that would clear the way for more reforms that could see growth accelerate. However, the race is tight and a wain by conservative right-wing candidate Karol Nawrocki could see the government of Polish Prime Minister Donald Tusk work deadlocked in infighting. Nevertheless, even in latter scenario, business is expected to continue to develop and outperform the rest of Europe.